OpenAI exits video space with shutdown of Sora and Disney deal. Dan Meier 25 March, 2026 OpenAI is sunsetting its video generation tool Sora, and winding down its content partnership with Disney, according to multiple reports this morning. Following a flurry of product launches in recent years, the AI firm is reportedly refocusing its strategy on business and coding functions. The move comes ahead of a potential initial public offering (IPO) later this year. Sora made waves upon its announcement in 2024 with its ability to create realistic video through basic prompts. But when the app launched in September, OpenAI employees were surprised by the amount of computing resources given over to the project without clear demand for the product, according to the WSJ. The report suggests the company's various product roll-outs created a complicated organisational structure with competing priorities. Earlier this month, the company's applications chief Fidji Simo said employees should not be distracted by "side quests", and called for a greater focus on building agentic capabilities into its products. On Tuesday, CEO Sam Altman told staff that products which use its video models will be shut down. In addition to the Sora consumer app, OpenAI will shutter the version of the product for developers, as well as video functionality inside ChatGPT. Generating revenues (not copyrighted characters) OpenAI is planning to launch an IPO as soon as Q4 this year, but AI tech stocks have been hit in recent months due to concerns around overspending and slow consumer uptake. The company is seemingly seeking to shore up its business model to win the business of coders and enterprise users. Sora was also exposed to legal action from media companies due to the lack of guardrails to prevent copyright infringement. Rival AI startup Midjourney was sued by Disney, Universal and Warner Bros. Discovery (WBD) alleging illegal use of their content, while Disney and Paramount threatened ByteDance with legal action over copyright violations by its Seedance video tool. The TikTok owner has put the global launch of Seedance 2.0 on hold as a result. But in December, Disney announced a deal to invest $1 billion in OpenAI, and as part of the agreement the company licensed more than 200 Disney, Marvel, Pixar and Star Wars characters to become available on Sora. In light of Sora's closure, the entertainment giant has reportedly walked away from the deal. A Disney spokesperson told the BBC, "We respect OpenAI's decision to exit the video generation business and to shift its priorities elsewhere." A key priority for OpenAI now appears to be advertising, as the business shifts its strategy towards generating revenues. The AI firm is rolling out ads in ChatGPT in the US, and this week announced the appointment of former Meta ad executive Dave Dugan to lead ad sales for the company. The strategy marks a different path to other AI startups such as Perplexity, which abandoned plans to introduce ads in its chatbot last month, and Anthropic, whose own Super Bowl ads mocked the idea of advertising within AI chatbots. Follow VideoWeek on LinkedIn. Reporter at VideoWeek. European Video Awards. * Now in its fifth year, VideoWeek's European Video Awards also known as 'the EVAs' celebrates the best in European video and connected TV advertising. * With 20+ expert-judged categories, EVA recognises the most innovative, creative, and impactful work from brands, agencies, publishers, creators, and technology partners. * The EVA's exists to recognise and elevate the people and companies shaping the future of connected TV and video advertising. * The awards bring together industry leaders and emerging talent, offering winners increased visibility, the opportunity for new collaborations and new business, and even new career opportunities.

Freedom Capital Markets initiates Butterfly Network stock with Buy rating. Investing.com - Freedom Capital Markets initiated coverage on Butterfly Network (NYSE:BFLY) with a Buy rating and a $5.00 price target on Wednesday, representing a 31% upside from the current price of $3.82. The medical imaging company has shown strong momentum, with its stock price surging 91% over the last six months according to InvestingPro data. The research firm's coverage initiation is based on observations that Butterfly Network's core ultrasound business is demonstrating growth momentum. This aligns with the company's 16% revenue growth over the last twelve months, though InvestingPro data indicates the company is not yet profitable. Freedom Capital Markets' model assumes continued revenue expansion for the medical imaging company, supported by adoption of the iQ3 probe and enterprise software solutions. The valuation incorporates Butterfly Network's evolving software ecosystem, which represents a key component of the company's business strategy. Freedom Capital Markets indicated it may revise estimates upward as visibility improves on Butterfly's Octiv project, suggesting potential for additional growth catalysts. In other recent news, Butterfly Network reported its third-quarter earnings for 2025, showing mixed results. The company's revenue exceeded expectations, reaching $21.5 million compared to the forecasted $21.22 million. However, its earnings per share (EPS) missed projections, with a loss of $0.13 against an anticipated loss of $0.04. Additionally, Butterfly Network announced a co-development and licensing agreement with Midjourney for its semiconductor-based ultrasound technology. Midjourney will pay a one-time fee of $15 million and an annual license fee of $10 million, with potential additional payments of up to $9 million. Furthermore, Butterfly Network launched Compass AI, an enterprise software platform aimed at enhancing point-of-care ultrasound programs for healthcare systems. This AI-powered platform addresses documentation and workflow challenges, which have historically limited the financial viability of these programs. These developments reflect Butterfly Network's ongoing efforts to innovate and expand its technological offerings. This article was generated with the support of AI and reviewed by an editor. For more information see our T&C. Which stock should you buy in your very next trade? AI computing powers are changing the stock market. Investing.com's ProPicks AI includes dozens of winning stock portfolios chosen by our advanced AI. Year to date, 2 out of 3 global portfolios are beating their benchmark indexes, with 88% in the green. Our flagship Tech Titans strategy doubled the S&P 500 within 18 months, including notable winners like Super Micro Computer (+185%) and AppLovin (+157%). Which stock will be the next to soar?